UK budget sees weaker growth, more borrowing

2017年 11月 23日 Thursday - 02:00

Britain slashed its economic growth forecasts and expects to borrow a lot more going into the next decade, finance minister Philip Hammond said, but he nonetheless plans to spend more in the next couple of years to offset the impact of Brexit. David Pollard reports.

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'Bold' or 'boring'.
The bets were on whether this budget would spend courageously to reassure a nervous economy...
Or stick with austerity.
In the event, another b-word emerged.
(SOUNDBITE) (English) BRITISH FINANCE MINISTER, PHILIP HAMMOND SAYING:
"This Budget, we choose a balanced approach."
But that 'balance' is a tricky one, given the prospect of slower growth - and lower government revenues.
This year, GDP forecasts revised down to one and half per cent - and to just 1.3 by 2019.
Government borrowing expected to go up - with the budget deficit seen nearly doubling by 2021/22.
(SOUNDBITE) (English) BRITISH FINANCE MINISTER, PHILIP HAMMOND SAYING:
"Our debt is still too high, and we need to get it down. Not for some ideological reason, but because excessive debt undermines our economic security, leaving vulnerable to economic shocks."
Shocks like the other 'B' of the day: Brexit.
(SOUNDBITE) (English) BRITISH FINANCE MINISTER, PHILIP HAMMOND SAYING:
"The negotiations on our future relationship with the EU are in a critical phase .... We have already invested almost 700 million pounds in Brexit preparations ... and today I am setting aside over the next two years another 3 billion pounds."
But three billion adding little lustre to a budget announcement that first saw sterling weaken ...
Then pop back again to trade slightly higher.
As markets decided 'boring' was the appropriate label after all.
SOUNDBITE) (English) MIKE INGRAM, CHIEF MARKET STRATEGIST, WH IRELAND, SAYING:
"One of the one things that people have looked for in the budget is a vision ... something which will give consumers and investors in the UK confidence. I'm not sure we're able to do that because I say the cash just isn't there."
Extra spending on health and housing may raise hopes in those sectors.
While elsewhere, a 12 pence cut in the price of beer will comfort those Brits who support Brexit ....
As much as those who want to drown their sorrows because of it ...